Sanchez Energy Corp. (NYSE: SN) detailed the revisions to its 2014 capital plan, the company said March 25.
Tony Sanchez III, president and CEO, said that the company’s capital plan was reduced to a range of $600 million-$650 million, down from $650 million-$700 million, and added that despite the reduction, full-year production guidance would be met, with all wells spudded and completed.
Of the $600 million-$650 million budgeted, about 94% will be allocated to drilling and completing 70 net wells—89% of that amount will be for Eagle Ford Shale wells, the company said.
Currently, there are six rigs—four operated and two nonoperated—in the Eagle Ford, and there are also 15 gross wells being completed there, Sanchez Energy said.
Sanchez III commented that overall, total well costs for the company have decreased 30%, while the use of more multi-well pads has led to a 40% decrease in drilling time and a 35% increase in the average footage drilled daily.
Sanchez III said that well costs for the Cotulla area’s Alexander Ranch and Wycross sections are estimated at between $5.5 million-$6 million and $7.5 million-$8 million, respectively. He added that in the Marquis, well costs should run between $8 million-$8.5 million, down from initial estimates of $11 million-$14 million.
Houston-based Sanchez Energy Corp. operates in the Tuscaloosa Marine and Eagle Ford Shales.
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